Twin Disc (TWIN) AI Stock Analysis

• Market Cap: $100.29M
• Dividend Yield: 2.26%
• Average Volume (3M): 50.30K
• Price to Earnings (P/E): 10.5
• Beta (1Y): 0.83
• Revenue Growth: 9.23%
• EPS Growth: -16.27%
• Country: US
• Employees: 910
• Sector: Industrials
• Sector Strength: 70
• Industry: Industrial - Machinery
• EPS (TTM): 0.67
• Shares Outstanding: 14,145,862
• 10 Day Avg. Volume: 64,034
• 30 Day Avg. Volume: 50,297
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.36
• Price to Cash Flow (P/CF): 3.40
• P/FCF Ratio: 4.90
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Twin Disc shows solid financial performance with growth in revenue and strong cash generation. However, technical indicators suggest a bearish trend, and valuation is fair without being compelling. Recent strategic acquisitions offer positive long-term prospects, but challenges in profit margin and specific segments need addressing.

Twin Disc Business Overview & Revenue Model

Company Description

Twin Disc, Inc. (TWIN) is a global leader in power transmission technology, specializing in the design, manufacture, and distribution of power transmission equipment for a variety of industries. The company primarily serves the marine, industrial, and off-highway markets, offering a comprehensive range of products including marine transmissions, surface drives, propellers, and industrial power take-offs. With a commitment to innovation and quality, Twin Disc provides customized solutions that enhance the performance and reliability of customers' machinery and vehicles worldwide.

How the Company Makes Money

Twin Disc generates revenue through the sale of its power transmission products and systems. The company's key revenue streams include marine products, such as transmissions and controls for boats and ships, and industrial products, which encompass power take-offs and hydraulic systems used in construction, agriculture, and energy sectors. Twin Disc also offers aftermarket services, including spare parts and maintenance support, which contribute to its revenue. The company's earnings are supported by its global distribution network and strategic partnerships with original equipment manufacturers (OEMs), enabling it to reach diverse markets and maintain strong customer relationships.

Twin Disc Financial Statement Overview

Summary

Twin Disc shows solid financial performance with revenue growth and improved profitability. The balance sheet is stable with a conservative leverage profile, and cash flow management is strong, though there is room for operational efficiency improvements.

Income Statement

Twin Disc has demonstrated solid revenue growth and profitability improvements. The TTM (Trailing-Twelve-Months) revenue of $321.4 million shows a notable increase from the previous year. The gross profit margin improved to 27.1%, and the net profit margin is now at 2.9%, reflecting better cost management. However, EBIT and EBITDA margins indicate room for further operational efficiency improvements.

Balance Sheet

The debt-to-equity ratio stands at 0.28, indicating a conservative leverage profile. ROE for the TTM is 6.4%, showing profitability against equity. The equity ratio is 47.8%, highlighting a healthy balance between assets and equity. While there is stability, further enhancement in equity growth and asset utilization could strengthen the position.

Cash Flow

Free cash flow has decreased in the TTM, but the operating cash flow to net income ratio is favorable at 1.88, indicating strong cash generation capabilities. The free cash flow to net income ratio is 1.28, showing effective cash conversion. Continued focus on capital expenditure and cash management will be crucial.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
321.40M	295.13M	276.96M	242.91M	218.58M	246.84M
	Gross Profit
87.03M	83.32M	74.33M	68.81M	50.86M	55.71M
	EBIT
11.07M	11.48M	16.06M	11.04M	-8.30M	-9.14M
	EBITDA
22.22M	27.05M	22.23M	21.34M	4.16M	-30.13M
	Net Income Common Stockholders
9.38M	10.99M	10.38M	8.10M	-20.70M	-39.57M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
14.53M	20.07M	13.26M	12.52M	12.34M	10.69M
	Total Assets
254.23M	312.06M	289.18M	276.52M	275.41M	294.13M
	Total Debt
35.10M	48.22M	29.44M	47.12M	44.97M	56.08M
	Net Debt
20.57M	28.15M	16.18M	34.60M	32.63M	45.39M
	Total Liabilities
150.09M	157.00M	143.66M	145.34M	144.75M	154.17M
	Stockholders Equity
103.28M	154.70M	145.09M	130.78M	130.21M	139.39M
Cash Flow		Free Cash Flow
11.99M	25.01M	14.98M	-13.04M	2.06M	-1.08M
	Operating Cash Flow
17.64M	33.72M	22.90M	-8.31M	6.53M	9.62M
	Investing Cash Flow
-34.30M	-32.07M	-408.00K	5.90M	-2.74M	-10.62M
	Financing Cash Flow
2.66M	2.75M	-19.51M	4.05M	-4.32M	-1.05M

Twin Disc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 7.09
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TWIN, the sentiment is Negative. The current price of 7.09 is below the 20-day moving average (MA) of 7.67, below the 50-day MA of 8.65, and below the 200-day MA of 11.27, indicating a bearish trend. The MACD of -0.34 indicates Negative momentum. The RSI at 38.14 is Neutral, neither overbought nor oversold. The STOCH value of 21.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TWIN.

Twin Disc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MWA	79 Outperform	$3.84B	28.12	17.49%	1.07%	11.94%	77.46%
ITT	78 Outperform	$10.17B	19.94	19.60%	1.04%	10.59%	27.04%
DOV	76 Outperform	$22.22B	8.34	24.30%	1.27%	-2.99%	159.26%
PLOW	73 Outperform	$519.95M	9.52	22.04%	5.24%	0.06%	137.74%
Sector *	62 Neutral	$7.62B	13.01	3.19%	3.32%	3.77%	-14.28%
TWIN	61 Neutral	$100.29M	10.55	6.42%	2.26%	9.23%	-16.27%
CMCO	61 Neutral	$370.82M	40.81	1.07%	2.16%	-2.02%	-80.76%

Twin Disc Corporate Events

Twin Disc Acquires Kobelt to Enhance Product Portfolio

On February 14, 2025, Twin Disc entered into a new Credit Agreement with Bank of Montreal, refinancing a prior agreement, and acquired all shares of Kobelt Manufacturing Co. Ltd. The acquisition, completed for CAD $23,397,932, is expected to enhance Twin Disc’s product portfolio and expand its market reach in the marine and industrial sectors. Kobelt’s integration is anticipated to be immediately accretive to Twin Disc’s earnings and will benefit from Twin Disc’s global presence. Kobelt brings extensive after-sales services and specialized capabilities, contributing to Twin Disc’s positioning as an integrated systems supplier.

Twin Disc Reports Strong Q2 Sales Growth for 2025

On February 5, 2025, Twin Disc, Inc. reported a 23.2% increase in sales year-over-year for the second quarter of fiscal 2025, totaling $89.9 million, driven by both organic growth and the acquisition of Katsa Oy. The company’s net income was $0.9 million, and EBITDA rose by 13.5% to $6.3 million. Despite challenges in the Asian oil and gas markets, the marine and industrial segments showed significant growth, and the company maintained a strong backlog of $124 million. Twin Disc aims to continue its strategic focus on niche capabilities and growth in hybrid and electric solutions.

Twin Disc Shares Non-GAAP Insights at Investor Meetings

Twin Disc’s executive officers are set to present materials at investor meetings and conferences from February 5, 2025. These materials, which include non-GAAP financial information, will be available on the company’s website. The company emphasizes that these non-GAAP measures provide valuable insights into their core business performance, despite not being directly comparable to GAAP measures or those used by other companies.